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Qatar-GCC diplomatic dispute ‘may grow over time’ - NBK

Qatar-GCC diplomatic dispute ‘may grow over time’ - NBK
Qatar-GCC diplomatic dispute ‘may grow over time’ - NBK

Qatar-GCC diplomatic dispute ‘may grow over time’ - NBK

Mubasher: Qatar’s economy has been negatively affected by its neighbouring GCC countries’ sanctions that started in early June 2017, which included withdrawing ambassadors and imposing trade and travel bans.

While the impact of political dispute has been “moderate so far”, it has affected some sectors over others, according to a report by the National Bank of Kuwait (NBK).

The regional isolation affected some of the countries’ major sectors such trade, travel and tourism while many sectors were not affected at all.

After the shock, some of affected sectors started recovering and turning to normal, and analysts still expect that non-oil economy will return to its normal rates by the end of 2017 and next year.

“But the cost to the Qatari economy of regional isolation could grow over time, especially if, as now seems plausible, the dispute lasts for a number of years,” NBK stated.

According to the report, the number of visitors to Qatar plummeted by 55% between May and June and year-on-year in September, the report showed. Meanwhile, Gulf visitors, who represent half of all visitors to Qatar, plunged 84% year-on-year in September.

While visitors from other countries declined 10% in September 2017, compared to the year-ago period, but NBK noted that their numbers were higher earlier in 2017. 

Meanwhile, the Qatari oil sector was not affected by the sanctions, as the daily output remained stable at 2 billion cubic feet, which form 16% of the country’s total exports of gas.

This stability in gas prices has “avoided pressure on the fiscal position and the balance of payments,” NBK stated.